Conflict of Laws
Assignment 2 (revision question 3)
Summary of the conflict of laws issues relevant to the common law proceedings
Freddie wishes to bring against Aotearoa Tours in New South Wales:
1.
“Common law proceedings”
Common law proceedings include proceedings in tort and proceedings in
contract. In the present case there is the possibility of concurrent liability in
tort and contract as the contract between Freddie and Aotearoa Tours
may include an implied or express term that Aotearoa Tours will exercise
reasonable care in the conduct of the tour. On the other hand, the contract may
include an express term which excludes or negatives the liability of Aotearoa
Tours. Compare Sayers v. International Drilling Co [1971] 3 All ER 163.
Although further information is required as to whether the contract includes
any such implied or express terms as described above, conflict of laws
principles indicate that consensus ad idem and the terms of the contract are
governed by the lex fori (New South Wales law): Oceanic Sun Line Special
Shipping Co v. Fay (1988) 165 CLR 197. In other words, whether the contract
includes a particular implied or express term is an issue governed by the lex
fori.
Freddie should be advised in relation to both proceedings in tort and
proceedings in contract.
2.
Jurisdiction
As Aotearoa Tours has a business office in New South Wales it would appear
to be present in the state for the purposes of common law jurisdiction:
National Commercial Bank v. Wimborne (1979) 11 NSWLR 156. Another
basis of common law jurisdiction is the New South Wales jurisdiction clause
in the contract which constitutes a voluntary submission by express
agreement. Compare Dunbee v. Gilman & Co (Australia) (1968) 70
SR(NSW) 219.
In any event, in both proceedings in tort and proceedings in contract there is a
basis for service out of the jurisdiction under Uniform Civil Procedure Rules
2005 (NSW). Freddie has suffered tort damage in New South Wales
(Schedule 6 para (e); Brix-Neilsen v. Oceaneering Australia [1982] 2 NSWLR
173) and the contract was made in New South Wales and, arguably, New
South Wales law is the proper law of the contract (Schedule 6 para (c); Lewis
Construction Co v. M Tichauer [1966] VR 341). The proper law of the
contract is discussed below.
3.
Discretionary non-exercise of jurisdiction
Apart from the significant connecting factors between the parties and New
South Wales (e.g. the contract was made in New South Wales, Freddie is a
New South Wales resident, Aotearoa Tours has a business office in New
RA.CoL.06.Assig.2 revision quest 3
South Wales), the New South Wales jurisdiction clause in the contract would
negative any application by Aotearoa Tours for a stay of proceedings on the
ground of forum non conveniens (“clearly inappropriate forum”). Compare
Voth v. Manildra Flour Mills (1990) 171 CLR 538.
4.
Substance and procedure
In Freddie’s common law proceedings in New South Wales, all procedural
issues will be governed by New South Wales law as the lex fori. However, all
substantive tort issues will be governed by the law of the place where the tort
was committed (lex loci delicti) and all substantive contract issues will be
governed by the proper law of the contract. The lex loci delicti and the
proper law of the contract are discussed below.
5.
Proof of foreign law
The New South Wales court may take judicial notice of any relevant New
Zealand legislation : Evidence and Procedure (New Zealand) Act 1994 (Com)
s 40. However, any relevant provisions of New Zealand common law must be
proved by expert evidence and/or in accordance with the Evidence Act 1995
(NSW) ss 174, 175. In the absence of proof of any relevant provisions of New
Zealand common law, the court will presume that New Zealand law is the
same as New South Wales law : see Dyno Wesfarmers v. Knuckey [2003]
NSWCA 375.
6.
Choice of law in contract
The first issue is to identify the proper law of the contract. There is no
information that the contract included an express choice of law clause. The
New South Wales jurisdiction clause may constitute an inferred choice of New
South Wales law as the proper law of the contract : Lewis Construction Co v.
M Tichauer [1966] VR 341 (exclusive French jurisdiction clause indicated an
inferred choice of French law).
In the absence of an express or inferred choice of law, the proper law of the
contract is the system of law with which the transaction has its closest and
most real connection : see Mendelson-Zeller Co v. T and C Providores [1981]
1 NSWLR 366; Garstang v. Cedenco JV Australia [2002] NSWSC 144.
Factors in favour of New South Wales as the legal system with which the
transaction has its closest and most real connection include (a) the contract
was made in New South Wales and (b) both parties had a significant
connection with New South Wales at the time the contract was made. On the
other hand, the principal place of performance of the contract was New
Zealand.
The second issue is liability for breach of contract (Aotearoa Tours’
negligence) which is governed by the proper law of the contract. If this is
New Zealand law rather than New South Wales law, Freddie’s proceedings in
contract in New South Wales will fail as civil liability for personal injury was
abolished by statute in New Zealand in 1972.
RA.CoL.06.Assig.2 revision quest 3
2
7.
Choice of law in tort and concurrent liability
The first issue is to identify the place where the tort was committed. This
would appear to be New Zealand where the relevant negligence on the part of
Aotearoa Tours occurred : see Distillers Co (Biochemicals) v. Thompson
[1971] AC 458. If New Zealand is the place where the tort was committed,
Freddie’s proceedings in tort in New South Wales will fail by reference to
New Zealand law as the lex loci delicti : Regie Nationale des Usines Renault
v. Zhang (2002) 187 ALR 1. It should be noted, however, that failure of the
proceedings in tort by reference to the lex loci delicti will not affect the
proceedings in contract if such proceedings are maintainable by reference to
the proper law of the contract : Garstang v. Cedenco JV Australia [2002]
NSWSC 144; Busst v. Lotsirb Nominees [2003] 1 QdR 477.
8.
Conclusion
The vital issue is whether the proper law of the contract is New South Wales
law rather than New Zealand law. If the proper law of the contract is New
South Wales law, Freddie may bring proceedings in contract against
Aotearoa Tours to recover damages for the personal injury suffered in the
accident in New Zealand. In any such proceedings, New Zealand law would
not be relevant.
______________________________________
Ross Anderson
LEC lecturer
RA.CoL.06.Assig.2 revision quest 3
3